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PEAK Grantmaking

Making the Most of Organizational Assessments

How can funders support nonprofit grantee partners in assessing their organizational capacity needs to become stronger, healthier organizations? This is what the Hewlett Foundation’s Effective Philanthropy Group was curious to understand when we commissioned a study to learn more about organizational assessment – what assessment tools existed, how are they being used by funders and nonprofits, and what are some lessons we can take back to inform our approach?

Organizational assessment tools are used to help gauge an organization’s strengths and needs in capacity areas such as strategy, leadership and management, governance, organizational culture, financial and fundraising structure, and learning and evaluation ability. These tools support a nonprofit in assessing and determining which capacity areas need to be strengthened, and can facilitate important discussions among leadership, board, and staff to help shape resulting priorities.

At Hewlett, our approach towards organizational assessment for grantees had mixed results in trying to help grantees identify priority areas for capacity-building. As part of our supplemental Organizational Effectiveness grantmaking program, we had been asking grantees to complete a pre/post self-assessment tool to rate their perception of strengths and weaknesses across different capacity areas. But we found the information from the tool wasn’t that helpful. The pre-self-assessment provided some surface-level insight into an organization’s strengths and capacity needs and sometimes served as a prompt for a program officer’s conversations with grantee organizations. However, we noticed that the inherent power differential predisposed our grantee partners to lean towards more positive responses in both their pre and post self-assessments, and it was often difficult to ascertain their real areas of need. In addition, we had been asking grantees to complete the table as part of the proposal process, often after a project had already been identified and agreed upon by the program officer and grantee. Since we were not analyzing the pre/post data in a systematic way, we decided to remove the table and not ask our grantees to provide data that were not being utilized.

In our PEAK webinar in December 2020, we shared the findings of our organizational assessment landscape scan and sat down with the Einhorn Collaborative (“Einhorn”) and City Year to learn how a funder and grantee could use organizational assessment in a productive and helpful way. Key findings included:

  • Relationship and trust between funder and grantee partner is key. If a funder is requesting a grantee conduct an organizational assessment and share their findings, building a trusting relationship where grantees can feel comfortable being candid and vulnerable with their program officer is critical. Hear more about how City Year and Einhorn developed a strong, trusting relationship that enabled City Year to conduct an organizational assessment process twice a year using the Performance Imperative tool created by LEAP Ambassadors.
  • External facilitator is recommended. A best practice that surfaced in our study is the use of an external facilitator, who can administer the assessment tool with staff and stakeholders and facilitate a discussion to bring together diverse viewpoints from all levels of the organization and reach agreement on priorities for capacity strengthening. While City Year did not use an external facilitator, they agree it would have been beneficial to have one the first time they brought together leadership and staff to use the tool. A facilitator could have removed some barriers to the process and helped them think about what level of reflection would add the most value.
  • Focus on the experience, not the tool. One of the big takeaways from the landscape study was that nonprofits who used an organizational assessment tool agreed that the process was more important than the tool. Creating the space and time for reflection and for conversations among leadership and staff are the most valuable parts that come out of an assessment. At City Year, while the Performance Imperative tool was helpful in framing a dialogue around organizational health, it was the process that was most valued by staff – to drive conversations, get buy-in, and reach agreement on priorities. City Year appreciated that Einhorn recognized the importance and value of the organizational assessment process and allowed them to set aside time for critical discussions on organizational priorities.

As a best practice, more funders are removing themselves from grantees’ organizational assessment processes. For example the Ford Foundation’s BUILD program utilizes the Organizational Mapping Tool (OMT) and brings in a trained facilitator to help grantees complete the OMT together. Individual program officers at Ford do not see the individual results but are provided with aggregated data to help understand trends and patterns across their grantees.

As a funder, it is important to remember that what we care most about is helping our grantee partners be strong, healthy organizations that are sustainable and can achieve the missions they have set out to do. Supporting a healthy organizational assessment process by building trusting relationships with grantees and adding a firewall between funder and grantee, bringing in (and paying for) an external facilitator, and prioritizing the experience over the tool will go a long way in setting up grantees for success.

Photo: Elliot Haney, for City Year